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Ken Tumin founded the Bank Deals Blog in 2005 and has been passionately covering the best deposit deals ever since. He is frequently referenced by The New York Times, The Wall Street Journal, and other publications as a top expert, but he is first and foremost a fellow deal seeker and member of the wonderful community of savers that frequents DepositAccounts.

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Best Reward Checking Accounts at Credit Unions - Update to the All-Access List

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Best Reward Checking Accounts at Credit Unions - Update to the All-Access List

In the last few months I've come across a couple of more credit unions that make it easy for anyone to qualify for membership. There’s also a reason why people may want to join these. Both credit unions offer top reward checking accounts. Many of the best reward checking accounts that offer the highest rates and have the largest balance caps are at credit unions. Unfortunately, most of these credit unions have restrictive membership. If you don’t work for a certain company or if you don’t live in a certain county, you probably can’t join. However, there are a few credit unions that have associations in their fields of membership which allow anyone to join. Once you join the association, you are then eligible to join the credit union. I call these all-access credit unions, and I have a big list of these all-access credit unions which currently totals 76.

Below are the two credit unions with top reward checking accounts that I’ve recently added to the big list:

  1. Belvoir Federal Credit Union - Woodbridge, VA (reward checking review)
  2. Great Lakes Credit Union - North Chicago, IL (reward checking review)

To learn more about reward checking, please refer to this reward checking overview.

Credit Union Times Article on All-Access Credit Unions

As you might expect, banks consider this as unfair competition since credit unions receive tax breaks. This 2010 New York Times article reported on this issue and the history of how large credit unions like PenFed evolved into an open membership. Yesterday, the Credit Union Times published an article on this issue. The article suggested that if credit unions are careful in following NCUA rules, there shouldn’t be a problem:

The NCUA requires that associations wishing to partner with credit unions to offer membership to their list of benefits maintain bylaws, a membership list, meetings and have dues requirements. However, there is nothing in the rules that prevents a credit union from using associations as a catch-all for those who aren’t otherwise eligible for membership.
[...]
Birmingham, Ala.-based industry consultant and former NCUA Board Member Dennis Dollar said there’s nothing wrong with collaborative arrangements between credit unions and associations that generate new members for both.

The coverage of this issue does show why credit unions are often subtle in how they describe how anyone can join. Often the credit union’s main intent of adding an easy-to-join association in its field of membership is to make it easier for locals to join. The side effect is that it can also allow anyone in the nation to join. However, credit unions don't always embrace new members who are not local. If you come across a credit union on the all-access list that is no longer easy to join for non locals, please leave a comment. Credit union fields of membership and management policies are in a constant state of flux.

Hopefully, Congress will focus on breaking up the megabanks rather than repealing the credit union tax exemption. Credit union expansion and its tax exemption have helped give savers more savings options. In today’s environment, savers need all the help that they can get.


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2 Comments.
Comment #1 by lou posted on
lou
Excellent post, Ken. I fully subscribe to your last paragraph: We need more choice, not less, with regard to where we deposit our savings. The most consumer-friendly thing the govt can do is ensure there is more competition among banks and credit unions. Restricting credit union membership and allowing banks to consolidate makes it too easy for the industry to keep deposit rates low and loan rates high.

9
Comment #2 by Anonymous posted on
Anonymous
If the banks would tell the real truth.  It is not the tax breaks that the credit unions get that causes unfair competition but the high executive compensation and excessive overhead costs that is their real problem in trying to compete with a credit union.

3